Principles
of Supply Chain Management -
building foundation for long term advantage

Successful Supply Chain
Management is a complex proposition. Within a
broad supply chain management there can be a number of
small supply chains which need to be managed. Each chain
is unique for the given player.

The stake for the different players is extremely high
making it imperative for the partners - including
suppliers, manufacturers, distributors and customers
behave as if they are part of the same company. This way
only they can enhance performance significantly across the
chain.

Having as the main concern a win win situation for all the
partners involved in the chain leads us to recognise and
adhere to the following principles of Supply Chain
Management :

Customer is the king :
Your operations are meaningless if you don't meet their
requirements. In a chain , your customer may be the
supplier to some other customer. As such its requirement
may be a certain quantity of material to be delivered in a
particular time period. Thus begin with the customer.

Management of Logistics :
It requires great planning and impeccable execution across
the whole chain.
It involves determination of locations
for distribution, management of inventory, transportation
etc besides laying down clear performance measurement
criteria for maintaining the standard of services.

Customer Management :
This needs to be properly organized so that the customer
gets the desired service. It may require aligning all the
supply chains under your command so that their combined
output meets the specific demand of the customer.

Process integration :
It is the most vital part, the fulcrum on which success of
the whole Supply chain exercise rests.

For its success it requires real time information sharing
among the chain partners and planning together for aspects
such as forecasts etc. across the chain.

Leveraging of Manufacturing and
Sourcing : It is not possible for the firms ,
even in a supply chain environment to manufacture
in-house, everything that is required across the chain.
Instead, outsourcing, lean manufacturing, Just in time (JIT)
etc need to be followed.

All these need proper linking
with each other to produce the desired effect.

Strategic alliances and
relationship management : Every chain partner
shall look from its own perspective in a supply chain
leading to strategic alliances across the chain. Once
formed these partnerships need to be developed through
effective relationship management

Develop performance measures :
Performance measure are basically development of standards
of performance and method for their measurement across the
chain so that suitable action can be initiated to see that
the performance of the entire chain remains optimum.

To sum it up the principles of supply chain management revolves
around customer and chain's efficiency in satisfying the
customer.